Should You Outsource Your Vehicle Reimbursement Program?
Mileage reimbursement is a cost effective solution that is easier to manage than in-house fleet management. It enables employees to use and maintain their own car, which results in fewer administrative duties for your company. By also outsourcing the management of your vehicle reimbursement program, you can reap all the benefits of this vehicle reimbursement program, while also reducing the workload on your in-house administrative staff.
Mileage Reimbursement Benefits
Managing your own vehicles means investing in a fleet of vehicles. Not only will you need to choose and source vehicles, but ensure that they are serviced and tested, and that they meet a high enough standard to ensure safety and prevent litigation by drivers. Enabling your mobile employees to use their own car means that your organization benefits along with your employees. The employee gets the car or truck they want to drive, and for the business there is no buying and selling of fleet cars, and you don’t have the same administrative load to deal with.
Running Your Business
Mileage reimbursement programs require less administrative maintenance than fleet management. By outsourcing vehicle reimbursement, you can enjoy all of the benefits of risk management, mileage and cost calculations, and accurately reimbursing employees, without the need to turn your admin department into a car management company. Essentially, you are left free to run and manage your business, rather than overseeing your employees’ driving.
Outsourcing for Precise Payments
An outsourced program, such as CarData’s Managed Program, calculates the costs accrued by your employees as precisely as possible. Precise calculation means calculating depreciation according to state and location, as well as calculating mileage reimbursement costs according to daily fuel rates and the precise amount of fuel that was used. The result is a neutral payment that accurately matches the cost to the employee, while ensuring that you do not have to pay more than is necessary.
As well as precise calculations, you can include additional services to further benefit your business. Your vehicle program coordinator can check driving licenses and insurance to ensure that employees are legally entitled to drive. They can check that insurance policies cover business use, and they can also help answer any questions that your drivers may have. Additionally, your Coordinator will conduct monthly reports of your program to keep you updated on the performance of your VRP.
Reducing Administrative Time With Direct Pay
You can further reduce the administrative burden on your company by opting for a direct pay program to distribute reimbursement payments to drivers. A direct pay program is an efficient way to distribute payments directly into drivers’ bank accounts, separately from the payroll process.
An outsourced vehicle reimbursement program offers benefits for both employees and employers. For more information about the services included in an outsourced reimbursement program, contact CarData, or visit our Learning Center.